ITC share price

ITC Stock Continues Bullish Run, Analysts Eye ₹530-538: Should You Invest Now?

Over the past three months, ITC’s stock has climbed a remarkable 22%, and 12% year-to-date (YTD), making waves in the stock market. Analysts remain bullish on the stock, especially as it breaks through the psychological barrier of ₹500, hinting at further upward potential toward ₹530-538.

On Thursday, September 26, ITC’s share price jumped nearly 1% to a record ₹522.50 on the Bombay Stock Exchange (BSE), pushing its market capitalization above ₹6.5 lakh crore for the first time. This latest surge underlines ITC’s robust position in the market, with investors and market watchers keeping a close eye on its future growth.

Key Developments Boosting ITC’s Market Performance

One major factor contributing to ITC’s rising stock price is its strategic moves in the FMCG sector. On September 25, ITC announced the allotment of 1,413 Compulsorily Convertible Preference Shares (CCPS) of Sproutlife Foods Private Ltd., reinforcing its investment in the fast-growing start-up.

This follow-up investment is part of ITC’s agreement, signed on April 19, 2023, to acquire 100% ownership of Sproutlife in phases. With this acquisition, ITC now holds approximately 47.5% of Sproutlife’s share capital, reflecting an investment of ₹255 crore.

Strengthening its FMCG Portfolio

The acquisition aligns with ITC’s long-term strategy of expanding its portfolio in the foods sector. Sproutlife, known for its ‘Yoga Bar’ brand, is a rising player in the health and wellness market, with a strong presence both online (D2C and e-commerce platforms) and offline retail outlets. This move positions ITC well to capture a larger share of the growing demand for healthy, packaged foods.

ITC Share Price Outlook: Analysts Expect Further Gains

ITC’s stock has been on an upward trend, gaining 22% over the last three months and 12% YTD. Over the past year, it’s up by more than 17%. Experts are optimistic about ITC shares as long as they stay above ₹500, which has become a key psychological and technical level.

Milan Vaishnav, founder of ChartWizard FZE and Gemstone Equity Research, expressed confidence in ITC’s ability to sustain its growth. “As long as ITC stays above ₹500, we can expect incremental highs in the stock. The FMCG sector overall is likely to outperform the broader market, and ITC is well-positioned to benefit,” Vaishnav noted. He predicted that ITC shares could hit ₹530-538 in the near term, adding that if the stock drops below ₹500, a period of consolidation could follow.

At 11:45 am on September 26, ITC shares were trading at ₹519.45, up 0.39% for the day, with a market cap of over ₹6.49 lakh crore.

Conclusion:

ITC’s consistent stock price growth and strategic investments, particularly in fast-rising sectors like FMCG, continue to fuel investor optimism. With analysts predicting gains as long as the stock holds above ₹500, ITC appears well-positioned for further growth in the coming months. As always, keeping an eye on technical levels like ₹530 and market developments will be key for both current and prospective investors.

FAQs:

1.Why is ITC stock rising?

A. ITC stock is benefiting from its strategic acquisitions, steady growth in the FMCG sector, and positive market sentiment.

2.What is the future outlook for ITC shares?

A. Analysts are optimistic about ITC’s future, expecting the stock to rise above ₹530, with support around ₹500.

3.Is ITC’s investment in Sproutlife a good move?

A. Yes, ITC’s investment in Sproutlife aligns with its long-term strategy to enhance its food product portfolio.

4.What is the significance of ITC breaking the ₹500 mark?

A. The ₹500 mark is both a technical and psychological level for investors, indicating the potential for further gains.

5.What are CCPS shares, and why are they important to ITC?

A. CCPS (Compulsorily Convertible Preference Shares) are a form of equity that ITC is using to increase its stake in Sproutlife, a growing start-up.

6.What is Yoga Bar, and how does it relate to ITC?

A. Yoga Bar is a health food brand owned by Sproutlife, in which ITC now holds a significant share as part of its strategy to expand in the FMCG sector.